Chesapeake sees a higher profit and raises its forecast on rising oil prices

Chesapeake sees a higher profit and raises its forecast on rising oil prices ...

Shale oil and gas company Chesapeake Energy Corp reported on Wednesday its adjusted profit increased by about 15% in the fourth quarter from the third and increased its earnings projection for 2022 due to rising oil prices.

Oil and gas prices have risen in recent months due to an economic recovery from the epidemic, yet supply growth has stagnated. U.S. crude futures opened at $92.10 per barrel on Wednesday, up nearly half from the same time last year.

Chesapeake's forecast for earnings for 2022 increased before interest, depreciation, amortization, and exploration (EBITDAX) reached $3.8 billion to $4.0 billion, compared to an earlier estimate of $3.4 billion to $3.6 billion.

A statement from the company said it would pay its first variable dividend in March, bringing its total quarterly dividend to $1.77 per share, a move that coincides with the company's pressure to focus on higher returns.

Diamondback Energy, a subsidiary, increased its annual dividend by 20% on Tuesday.

Chesapeake's stock was up roughly 0.75% after hours trading to $69 per share.

Chesapeake, which lost ground at the beginning of 2021, said its adjusted profit increased to $308 million, or $2.39 per share, in the third quarter, compared to $269 million, or $2.38 per share. According to Refinitiv IBES, analysts predicted net earnings of $2.48 per share.

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